Michigan OFIS to Hold Credit Scoring Public Hearings

Michigan Office of Financial and Insurance Services (OFIS) Commissioner Frank M. Fitzgerald announced his office will hold public hearings during June and July to gather information on the use of consumer credit history to set insurance rates and the effect of this practice on consumers in Michigan.

“Insurance companies legally can, and do, use credit history to establish insurance rates in Michigan,” Fitzgerald said. “This practice is considered a discount for homeowners and automobile insurance, just like discounts for seat belts or fire alarms. Because the link between credit history and the likelihood of a consumer filing a claim is not clear, the increasingly common practice of using credit to set insurance rates has raised many questions.”

The public hearings are scheduled as follows:

Tuesday, June 4 – Cadillac; 4:30 p.m. Wexford County Civic Center, 1320 North Mitchell;

Thursday, June 13 – Portage; 4:30 p.m. Portage City Hall, 7900 South Westnedge, City Council Chambers;

Saturday, June 15 – Port Huron; 11:30 a.m. City Hall, 200 Grand River, Board of Commissioners Room, 2nd Floor;

Tuesday, July 9 – Lansing; 4:30 p.m. Foster Community Center, 200 North Foster

Thursday, July 11 – Grand Rapids; 5:30 p.m. City Hall, 300 Monroe, N.W., City Commission Chambers, 9th Floor;

Thursday, July 18 – Detroit; 4:30 p.m. Wayne County Community College, Downtown Campus, 1001 West Fort Street, Room 123.

Subjects and issues that are expected to be addressed at the public hearings include: formulas used in credit scoring; whether credit scores can accurately predict the likelihood of filing an insurance claim; the range of credit history rate discounts being used; consumer awareness of the use of credit scores for setting insurance rates; how the use of credit scores for insurance rates is explained to consumers; and the role of insurance agents.

Topics Michigan